Foxtons opens new Islington office

London's most controversial agency announces the opening of its brand new Islington office at 355-357 Upper Street; beside Angel Tube station. The new office, accommodating 120 staff in a "café-style design" environment; is no doubt part of CEO Jon Hunt's "sale and leaseback" strategy in his efforts to break the US market.
Foxtons' money loosing presence in the New York metropolitan area began five years ago with a £12m investment in New Jersey, later expanding to Manhattan and eventually Connecticut. The Times reports that Hunt expects to loose £6m this year while absorbing a £32m investment from his New York operations.
Foxtons' controversial “beware of sharks charging 6%” advertising campaign hasn't gone down too well in America; where agents average 6% commissions per sale, versus the 2% that they're charging. Not only have the New York agents rebelled, but Hunt admits that it's not easy to convince the general public that there is no catch. Plus the rise of flat fee services like Redfin is causing great upheaval in the way the real estate game is played in the US and will no doubt greatly affect Hunt's ambitious American business model.
Nonetheless, with a UK pre-tax profit of £25m on sales of £90m, whatever short term losses Hunt experiences stateside can be easily offset by the profits he's making over here. The bigger question is long term sustainability of his American business model.
Foxtons expects to raise more than £14m through its ongoing sale and leaseback strategy of many of its London offices. They're also planning to expand operations outside London and into the rapidly growing Home Counties market, with new offices costing about £1m each to open.